Consider and adopt the proposed LAFCo Budget for fiscal year (FY) 2022/23 and set May 26, 2022 as the public hearing date to approve the final budget

1. Receive staff presentation and public comments on the Draft LAFCo Budget for FY 2022/23;
2. Close the public hearing, provide staff direction as desired, and set May 26, 2022 as the public hearing to consider approval of the Final Budget.

The attached LAFCo budget (Attachment A) includes proposed revenues, expenditures and projected fund balance for LAFCo for the next fiscal year. This proposed budget maintains adequate support for the Commission to meet its responsibilities under the Cortese-Knox-Hertzberg (CKH) Act and the shared services priorities identified in the LAFCo Annual Work Plan.

Yolo County LAFCo adopts an annual budget with notice to the four cities and Yolo County. In accordance with the CKH Act, a proposed budget must be adopted by May 1 and final budget by June 15 of each year. Following approval of the final budget and no later than July 1, the County Auditor requests payment from each agency. In order to meet these time lines, the final budget is scheduled to be adopted at the May 26, 2022 LAFCo Commission meeting and invoices will go out thereafter.

In accordance with the CKH Act, the cities and County split the cost of LAFCo funding 50/50. A formula for the split of the cities’ share is outlined in Government Code Section 56381 (b)(1); which would be in proportion to a city’s tax revenue or an alternative method approved by a majority of the cities. Beginning in FY 2007/08, the cities developed an alternative formula to apportion its 50% of LAFCo funding by averaging a city’s general tax revenue and population.

A more detailed table showing the formula for agency apportionment is attached for review (Attachment B).  In summary, the breakdown of agency apportionment of the LAFCo budget for FY 2022/23 is as follows:

City of Davis     16.68%
City of West Sacramento     17.40%
City of Winters     1.60%
City of Woodland     14.31%
County of Yolo     50.00%

The draft budget shows an overall appropriation decrease of 1% compared to last year with a total appropriation of $510,599. In addition, $5,000 would be transferred into reserves as a set aside for our next audit in 3years. Therefore, the total uses of both would be $515,599.

Salaries and Benefits costs are going up 1% overall with a 2% cost of living adjustment approved by Yolo County. The Services and Supplies appropriation is decreasing by 11%, mostly because the budget is ratcheting down from a $15,000 bump in appropriations last year to pay for the audit which occurs on a three year cycle. 

Even though the total apportionment decreases, there is much less estimated fund balance as compared to last year ($57,679 less). Therefore, total agency costs are going up significantly by 14% overall with fluctuations among cities per the allocation formula. The following itemizes the draft budget cost for each agency (and net increase as compared to the previous fiscal year).

City of Davis     $74,094 (increase of $8,814)
City of West Sacramento     $77,296 (increase of $9,086)
City of Winters     $7,129 (increase of $1,246)
City of Woodland     $63,580 (increase of $7,833)
County of Yolo     $222,100 (increase of $26,979)

Following Commission direction on the draft budget, staff will make any changes as directed by the Commission and send the proposed budget to the city/county managers for review and comment. Staff will report on all feedback received and any changes during the final budget hearing on May 26, 2022.